For years, growth stocks have been beneficiaries of outsized gains compared to the averages. The best growth stocks have 3 traits: strong fundamentals, great technicals, and a history of Big Money activity in the shares. Outlier stocks see a lot of Big Money buying.
Oftentimes, that can be institutional activity. We'll go over what that looks like in a bit. But the five stocks we see as long-term candidates will make you SMILE: SHOP, MIME, INMD, LRCX, & ETSY. 😊
For MAPsignals, we believe that Big Money trading can alert you to the forward fundamental picture of a stock. We want the odds on our side when looking for the highest quality stocks.
Up first is Shopify, Inc. (SHOP), which is an online commerce platform.
Even though their stocks can be volatile, like SHOP this year, great companies are worthy of attention. Check out SHOP:
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1 month performance (+17.6%)
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Historical big money signals
Just to show you what our Big Money signal looks like, have a look at the top buy signals Shopify has made the past few years.
Blue bars are showing that SHOP was likely being bought by a Big Money player according to MAPsignals.
When you see a lot of them, like SHOP did in 2019 (when it hovered around 1/4 of its current price), I call it the stairway to heaven:
Source: www.MAPsignals.com
But, what about fundamentals? As you can see, Shopify's revenue numbers have been strong:
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1-year sales growth rate (+71.3%)
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3-year sales growth rate (+64.0%)
Next up is Mimecast Limited (MIME), which is a cloud software and risk management company.
Check out these technicals for MIME:
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1-month performance (+29.1%)
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Recent big money signals
Let's look long-term. These are the top buy signals Mimecast has made since 2015. The Big Money may have found a new gem:
Source: www.MAPsignals.com
Let's look under the hood. As you can see, Mimecast has had rock-solid growth:
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3-year sales growth rate = 24.3%
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3-year earnings growth rate = 58.3%
Another growth name is InMode Ltd. (INMD), which is a maker of specialized medical equipment.
Strong candidates for growth usually have big money buying the shares. InMode has that. Also, the stock has bounced recently:
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1 month performance (+13.6%)
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Historical Big Money signals
Below are the big money signals InMode has made since 2019. That's the JUICE!
Source: www.MAPsignals.com
Now let's look under the hood. InMode's sales growth is impressive. I expect more growth in the coming years:
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3-year sales growth rate = +58.4%
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3-year earnings growth rate = +119.7%
Number four on the list is Lam Research Corporation (LRCX), which is a leading semiconductor industry supplier.